The Complete Guide to Choosing Payment Processors: Everything to Know

Did you know that there were 32.5 million businesses in the U.S. in 2021? 

One of the most crucial steps to launch your business is opening a payments processor account. Getting set up with a payment processor that fits your needs is essential to properly run your business.

But how do you choose the right one? How do you know how to find the right payment processor for your needs and your budget?

It’s simple. You need to make sure that you dig in and learn all the ins and outs of payment processors. Below is a brief guide to help you in choosing payment processors for your business.

Keep reading!

Security And Fraud Prevention

Payment processors and fraud prevention should be the top priority when making a selection, as security-related issues can quickly get out of hand without the right precautions. It’s important to look for payment processors with features like enhanced security protocols like encryption and tokenization. As well as fraud detection and prevention software.

It’s also beneficial to look for payment processors with compliance certifications, such as PCI, DSS, and ML/TF. Additionally, look for processors that offer features like chargeback management, consumer data protection, and dispute management. These features can help to protect business and customer data.

By selecting a payment processor that offers these security and fraud prevention features, an online business can rest assured knowing their payments and customer data are well protected.

Fees And Pricing

Payment processors can come with a wide variety of fees and pricing structures. Knowing which fees will affect your business is an important part of selecting the right payment processor. The most common fees are transaction fees, which are what the processor charges per transaction.

Some processors may also charge setup fees, monthly fees, chargeback fees (fees incurred from customers who disagree with a charge on their card and require a refund), and customer service fees. When evaluating options, be sure to get specifics on all the fees involved before making a decision.

It’s also important to look for a processor that will let you pay fees in the same currency as the payment. This could help you avoid hidden fees due to currency conversion charges. Taking the time to shop around and compare fees between different processors is worth the effort.

Integration And Developer Support

Integration and developer support are key elements when choosing a payment processor. Look for a payment processor that has documented APIs that allow for easy integration as well as knowledgeable customer support who can guide developers through the integration process.

The payment processor should also provide a range of tools and services to aid developers, such as SDKs and test environments. Additionally, the payment processor should make sure that the integration process is as smooth as possible to ensure that all customer requirements are met.

Additionally, look for a processor that provides a high level of support in terms of documentation and technical assistance, which may include training and tutorials. Lastly, ensure that the payment processor you choose provides ongoing support and updates to adapt to market changes and updates in technology.

Settlement And Payouts

Settlement and payouts for payment processors are important factors for businesses to consider when choosing a processor. Generally, payouts are categorized into two payment options: batch and instant. When it comes to batch payouts, the funds will be transferred to the merchant’s designated account on a predetermined schedule.

On the other hand, when the merchant has opted for an instant payout, the funds will be transferred as soon as the transaction is completed. Thereby enabling immediate access to the merchant’s funds.

If the merchant has established direct debit-based payment systems for recurring payments, payments may be automatically settled without the need for manual processing. Learn about this surcharging program that will help you understand how payment processing fees can be considerably reduced, increasing your profits.

Customer Support

Customer support is an essential factor to consider when comparing payment processing costs. A Payment Processor should provide consistent and quality customer support to ensure that users are provided with the help they require if they are experiencing issues with their payments. It’s important to evaluate customer support options which may include:

• live chat
• phone support
• email support 

It’s also important to ascertain the effectiveness of a provider’s customer service by reading online reviews, past issues the provider has addressed, and resolution times for each issue. Noting customer feedback can help you make a wise decision on the Payment Processor you choose.

Additionally, Payment Processors may also provide tutorials and references to assist customers. All these factors are important when choosing the right Payment Processor because they help you make an informed decision and ensure you’re choosing the provider best suited to meet your needs.

Reputation And Reviews

It is important to always research by comparing payment processing costs before you make a decision. Look up the processor on various sites and forums to find out how it has been reviewed and discussed. Check customer ratings as well as complaints.

Additionally, ensure that the payment processor is licensed and regulated by the appropriate financial authorities for the jurisdiction in which it operates. It is also important to research any security and privacy protocols in place, as your customer’s information and payment processes need to be kept secure. When selecting a payment processor, take your time to examine the website, reviews, customer service, fees, and data security.

Scalability And Growth

Payment processors offer scalability and growth opportunities to businesses. It can guide the scalability of the solutions, showing how different options can support a business’s specific needs and plans for growth. It can also help businesses understand the potential associated with integrating new payment methods, such as:

• mobile payments
• International payments
• subscription-based payments 

It can also help businesses to understand the fees associated with different providers.

Types Of Payment Processors

When choosing a payment processor, it is important to be aware of the types available and the associated pros and cons. There are two main types of payment processors: on-site (merchant) and off-site (third-party). On-site payment processors are housed on the merchant’s website and include gateways, payment middleware, and invoicing.

Off-site processors such as PayPal, Apple Pay, Google Pay, and Venmo are hosted outside of a merchant’s website and are the most commonly used.

Payment Methods

Payment Methods are of particular importance when it comes to choosing Payment Processors. It is vital to understand the different types of payment methods available in order to ensure you’re selecting the optimal Payment Processor for your business. Credit cards, debit cards, ACH payments, and eChecks, are just some of the most popular payment methods.

Taking the time to understand the various Payment processor’s policies around the different payment methods will help you better decide which is the best fit given your customer base and business operations. You don’t want to assume that all Payment Processors accept all payment types. Doing so may result in disappointed customers or a slower checkout process, which could hurt your business as a whole.

The good thing is that there’s no shortage of Payment Processors to choose from, so you can take your time to consider the different payment methods available and compare them to find the best fit for you.

Monitoring Transaction Data

When it comes to choosing payment processors, it is important to consider how they can help you monitor transaction data. Transaction data gives you insight into who is buying what and when they are buying. This data can be extremely important in developing targeted marketing strategies.

Look for payment processors that track purchases down to the smallest detail so that you can better understand your customers buying habits. Additionally, make sure that the information is stored in an encrypted format to ensure its security. Payment processors should also provide detailed reports on transaction data to make it easier for you to analyze.

Check for features like automated fraud detection and alerts, which can help point out any irregularities in the transactions. Finally, be sure that your payment processor offers customer support in case you have any questions or problems. By considering these factors when choosing payment processors, you can confidently monitor and protect your transaction data.

Establish Good Customer Support By Choosing Payment Processors

Choosing the right payment processor can be the key to a successful business. With so many to choose from, it’s important to weigh the pros and cons of each one to determine the best fit for your business. By reading this complete guide, you now understand the importance of making the right decision. 

Take the time to research the various payment processors and see which ones meet your needs and budget. Schedule your free consultation with a payment processing expert today to get started. Start processing payments and give your business the edge it needs!

If you’re looking for more ways that will help you with your business, check out the Business section of our blog. We have more articles that can help you grow and broaden your horizons.